> Axis Bank has increased its CASA market share multi-fold over the past nine years (4.6% as of FY2012) on the back of robust branch and ATM network expansion. The bank opened more than 400 branches in FY2011 (41.4% yoy) and added another 230 branches in FY2012. Going forward as well, an annual addition of 250+branches is expected to lead to a 30-50bp increment in CASA market share every year.

> Fee income contribution across a spectrum of services has been meaningful at 1.9-2.0% of assets (almost twice the level in PSBs) over FY2009-12.

> We expect Axis Bank to raise capital in the next 12-18 months as the bank's capital adequacy at the end of 1HFY2013 stood at 9.9% (Axis Bank had last raised capital in 2QFY2010, when its tier-1 CAR was 9.4%). Dilution is likely to be book-accretive and will aid in further enhancing the bank's credit market share going forward.

> Axis Bank is trading at 1.6x FY2014E ABV (~55% discount to HDFC Bank). We remain positive on the bank, owing to its attractive CASA franchise, multiple sources of sustainable fee income and reasonable growth outlook. We maintain our Buy recommendation on the stock with a target price of Rs 1,476.

> Crompton Greaves (CG), part of the USD 4 billion Avantha Group, is one of the leading players in the power T&D equipment business in India. The company operates across three segments - power systems, consumer products and industrial systems.

> In the last few quarters, Crompton Greaves' (CG) has been facing several headwinds on the international and domestic business fronts mainly due to a general slowdown faced by economies (impeding the revenue visibility) and increasing competitive pressures (taking a toll on profitability). However, we are of the opinion that CG's margins will bottom out in FY2013and we expect operating margin to improve going forward as the company restructures its Belgium unit. In its three-year vision, the management has targeted margin expansion of 450bp on the back of high value offerings, better sourcing and improved manufacturing footprint, which we think is a step in the right direction.

> Given the attractive valuations (stock trading at 0.6x FY2014E EV/Sales compared to its trading range of 0.7x to 1.6x and median of 1.2x), we maintain our positive stance on the company. We have assigned an EV/sales multiple of 0.7x to arrive at a target price of Rs 145, implying on upside 16% from the current levels.

> ICICI Bank's substantial branch expansion (from 955 branches at the end of 3QFY2008 to 2,772 branches by 2QFY2013) and strong capital adequacy at 18.3% (tier-1 at 12.8%) have positioned it to gain CASA and credit market share, respectively. Over FY2010-12, the bank improved its market share of savings deposits by 11bp, capturing a substantial 5.5% incremental market share.

> The bank's strategic transformation has expectedly resulted in significantly better balance sheet and earnings quality. The distinguishing feature of the bank's performance in FY2010 was the improvement in CASA ratio to 42.1% (transformative considering that the ratio was as low as 22% at the end of FY2007 and 29% even as recently as FY2009). The CASA ratio as of 2QFY2013 remains healthy at 40.7%.

> The bank's asset quality continues to improve, with a declining trend in additions to gross as well as net NPAs. The reduction in risk profile of advances has resulted in a commensurate decline in NPA provisioning costs and is reflected in improved RoA, from 1.0% in FY2010 to 1.3% in FY2012.

> The stock is trading at an attractive valuation of 1.7x FY2014E P/ABV. Hence, we maintain our Buy view on the stock with target price of Rs 1,270, valuing the core bank at 2.2x FY2014E P/ABV and assigning a value of Rs 153to its subsidiary.

> Lupin is one of the highest filers of ANDAs in the Indian pharmaceuticals industry. As of FY2012, the company's cumulative filings stood at 173, of which 64 have been approved. Lupin plans to launch 20 products in the US in FY2013 and another 80 products over the next three years, including nine exclusives.

> In the oral contraceptive (OC) segment, Lupin plans to launch around 10 ANDA's in FY2013. As per management, the OC segment is expected to contribute US$100million to the company's top line over the next 2-3 years.

> Lupin continues to make strides in the Indian market. Currently, Lupin ranks No.5, climbing up from being No.11 six years ago. Lupin has been the fastest growing company among the top five companies in the domestic formulation space, registering a strong CAGR of 20% over the last three years. For FY2013 and FY2014, management has reinforced ~20% growth in the Indian market.

> Management has given a revenue guidance of US$3billion by FY2013-14. We expect Lupin's net sales to post a 19.3% CAGR to Rs10,082cr and earnings to report a 26.5% CAGR to Rs31.1/share over FY2012-14E. We maintain our Buy rating on the stock with a revised target price of Rs 652.

> Tata Steel has completed its 2.9million-tonne expansion program at the Jamshedpur plant. The product mix constitutes 2.5million tonne of hot rolled coil (HRC) and 0.3million tonne of slabs. We expect this expansion to contribute ~Rs2,500cr per annum to the company's consolidated EBITDA, once the new plant reaches optimum capacity utilization, as it will be backed by captive iron ore.

> Tata Steel is in the process of developing a coking coal mine in Mozambique and an iron ore mine in Canada to enhance integration levels of Tata Steel Europe (TSE). The total capex remaining for the Mozambique project is US$100million-150million, while the Canadian project will involve a capex of CAD350million. We expect these backward integration projects at Mozambique and Canada to boost TSE's earnings beginning 2HFY2013.

> Tata Steel is setting up a 6million-tonne integrated steel plant (including cold rolling mill) in two phases of 3million tonne each for a capex of Rs 345 billion. Phase 1 of the 3million-tonne plant is expected to be completed by CY2014. This project is expected to have high returns on invested capital as it would be backed by captive iron ore.

> The stock is currently trading at an inexpensive valuation of 5.1x FY2013E and 4.5x FY2014E EV/EBITDA. On a P/B basis, the stock trades at 0.8x FY2013E and 0.7x FY2014E earnings. We maintain Buy on the stock.

> Wipro has identified four momentum industry verticals: 1) BFSI, 2) energy and utilities, 3) retail and 4) life sciences and healthcare and these verticals account for 65% of the company's revenue. The managements of all its peer companies have indicated that IT spend in industry verticals such as retail and energy and utilities is expected to grow higher than the overall industry growth and Wipro's exposure to energy and utilities is ~100% higher than the next largest competitor in this space (Infosys). We expect USD and INR revenue CAGR for IT services to be at 8.9% and 13.3%, respectively over FY2012-14E.

> Wipro has operating margin levers such as improving utilization level and increasing offshore revenue. Wipro's utilization level is currently at 66.8%, which is almost at its historic low levels. The company has headroom to improve its utilization by ~250bp even if management does not want to run a tight ship. In addition, increasing off shoring of revenue could offer a cushion to its margins.

> We believe that the step taken by Wipro to hive off its non-IT business is positive for its shareholders. The demerger would result in an increase in ROCE and ROE of the listed entity, as non-IT business had lower return ratios. We expect a 12.8% and 11.1% CAGR in EBITDA and PAT over FY2012-14E. We value the stock at 15x FY2014E EPS of Rs 28.1, which gives us a target price of Rs 421 and recommend it as one of our top picks with Buy rating.

> DB Corp is one of the leading publishing houses in India, with seven newspapers and 65 editions in four languages across 13 states. The company has an advertising focused revenue model with average cover prices being the lowest among peers at Rs2.6.

> The company's continuous endeavor to diversify its print business with aggressive expansion into new markets (urban towns beyond metros) backed by exhaustive market research and focus on achieving leadership has made it a multistate leader. DB Corp leads its nearest competitor in its market with a huge margin in terms of circulation and it ensures steady advertising revenue even during lean times. We expect ~15% CAGR growth in ad revenue over FY2012-FY2014.

> Due to cyclical headwinds such as sluggish ad revenue (due to slower GDP growth) and higher newsprint costs in INR terms (due to INR depreciation vs USD), the stock is currently trading at relatively cheaper valuations of 14.6x FY2014E consolidated EPS of Rs14.4 (at 5% premium to Sensex). However, considering the structural positives of print business (high brand loyalty and significant entry barriers) and DB Corp's multistate leadership, in our view, the stock deserves a higher premium to the Sensex. Hence we assign a target a multiple of 18x FY2014E EPS, benchmarking it to our print media sector valuation (which are at 15% premium to the Sensex) and maintain our Buy view on the stock with a target price of Rs 259.

> MRF is a market leader in the tyre industry with a ~30% market share. The company is present across all categories of tyres, with an installed capacity of 3.2cr tyres. MRF also exports tyres to over 65 countries in America, Europe, Middle East, Japan and the Pacific region.

> There is an industry shift towards radial tyres in the truck segment, where capital expenditure for radial tyres is 3.2x that of cross-ply tyres. Thus, in order to generate normalized RoCE and RoE, tyre companies would need to earn EBITDA margins of ~20% on radial tyres in comparison to ~9% on cross-ply tyres, leading to a 20-25% higher pricing for radial tyres. As radicalization in the tyre industry is already past the S-curve inflection point of 8-10%, volumes of radial tyres are likely to witness a CAGR of more than 25% for the next five years.

> Rubber prices which constitute a major proportion (~60%) of the raw material cost for tyre manufacturing, have been range bound at Rs175-185/ kg which is lower than the average price of ~Rs190/kg witnessed in 2QSY2012. Lower rubber price is expected to improve the EBITDA margin and consequently result in better profit.

> At the current market price of Rs10,169, the stock is trading at a PE of 7.1x its SY2013E earnings, which we believe is attractive. We maintain our Buy rating on the stock with a target price of Rs 12,884 based on a target PE of 9.0x for SY2013E.

> United Phosphorus (UPL) figures among the top five generic agrichemical players in the world, with a presence across major markets such as the U.S., EU, Latin America and India.

> The total off-patent market is worth US$29billion, of which a mere US$16billion is currently being catered by generic players. Furthermore, 61% of the same is controlled by the five largest generic players, including UPL. Given the high entry barriers by way of high investments, entry of new players is restricted. Thus, amidst this scenario and on account of having a low cost base, we believe UPL enjoys an edge over competition and is placed in a sweet spot to leverage the upcoming opportunities in the global generic space.

> Over FY2012-14E, we estimate UPL to post a 10% and 18.4% CAGR in its sales and PAT, respectively. Currently, the stock is trading at an attractive valuation of 6.7x FY2014E EPS. Hence, we maintain our Buy view on the stock with a target price of Rs 170.

> The company's domestic formulation business which contributed 54% to its total sales in FY2012, with ~70% of its revenue coming from the acute segment, has at least grown in line with the industry growth rate, before the share of the high growth chronic segment improves from the current levels of ~30%. For FY2012-14, we expect the domestic formulation business to grow at 14.0% CAGR.

> On the exports front, the formulation business contributed 20% to the total turnover, with majority of the contribution coming from Europe and the US. The company, going forward, expects to keep its momentum high in terms of number of filings, by filing around 12-18 ANDAs per annum. For FY2012-14, we expect the exports to register a CAGR of 21.1%.

> Alembic's growth and profitability profile have improved post the restructuring carried out by the management. Over FY2012-14, we expect the company to post a CAGR of 13.3% and 14.6% in its sales and net profit respectively. We maintain our Buy recommendation on the stock.

> Siyaram Silk Mills (SSM) is the largest manufacturer of blended fabrics in India. The company enjoys a strong brand presence across the country, with brands such as Siyaram's, Mistair, MSD, J. Hampstead and Oxemberg in its kitty.

> Being the largest manufacturer of blended fabrics in India, SSM enjoys a 4% market share in this segment. Polyester viscous fabric, which has become a cheaper substitute of cotton fabric, is the major contributor to SSM's revenue (~Rs 7-8 billion in FY2012). With increasing demand for polyester viscous fabric and shift from unbranded fabric to branded ones in tier II and tier III cities, we expect SSM to register revenue CAGR of 12.0% over FY2012-14E to Rs1,149 in FY2014E.

> The company is engaged in aggressive marketing with celebrity brand ambassadors like M S Dhoni, Neil Nitin Mukesh and Hrithik Roshan. Moreover, the company has one of the largest distribution networks in the country and is further planning increase the exclusive store count to 300 from 125 presently in the coming two to three years through franchisee route.

> At the current market price of Rs316, the stock is trading at a PE of 4.3x its FY2014E earnings. We maintain our Buy rating on the stock with a target price of Rs 366, valuing the stock at 5x FY2014E earnings.

> SpiceJet has the lowest debt amongst all listed players at Rs1,009cr, compared to Kingfisher Airlines (Rs8,719cr) and Jet Airways (Rs13,157cr) as of FY2012. Presence in the high-growth, low-cost segment and having the lowest debt compared to peers makes FDI investment in SpiceJet more lucrative than others.

> We believe the industry is witnessing a structural change, where airline companies have increased their ticket prices and competition has reduced to a certain extent post the capacity cutback by Kingfisher. SpiceJet is one of the few airlines that have been expanding capacity and hence can take full advantage of the mismatch between lack of supply, strong demand growth as well as increased ticket pricing, leading to better profitability in the future. We expect SpiceJet to witness high load factor going ahead and report full year profits for FY2013-14E.

> Jet fuel constitutes 30-50% of the operating cost of an airline. SpiceJet would be the first airline to start importing fuel and has already signed agreements for transportation and storage of ATF with private oil companies. We believe even though the savings from direct import of ATF might be on the lower end in absolute terms, they gain significance considering the entire industry is struggling to make profits.

> On the valuation front, SpiceJet is trading at EV/sales of just 0.3x FY2014E, lower than its peers. Hence we recommend a Buy rating on the stock.

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